Archives for July 2015

The agreement on the country’s membership was signed Monday in Geneva; it now has to be ratified by the Kazakh parliament by October 31.

The President of Kazakhstan Nursultan Nazarbayev said that Kazakh economy “has become stronger and more open” since negotiations with the WTO began almost 20 years ago.

“In the mid-1990s, Kazakhstan had ties only with post-Soviet states, while now we are trading with 185 countries of the world,” Nazarbayev said.

The European Union is Kazakhstan’s main economic partner, accounting for more than 54 percent of its foreign trade, according to the Kazakh President.

He also said there is a “sizable contribution” of trade with Russia, China, the United States, Canada and some other countries.

After the signing ceremony Director-General of the WTO Roberto Azevedo said he hoped that in December Kazakhstan will take part in the 10th Ministerial Conference in Kenya.

READ MORE: Russia, Belarus, Kazakhstan sign ‘epoch’ Eurasian Economic Union

Currently Kazakhstan is a member of two economic blocks led by Russia – the Customs Union that also includes Belarus, and the Eurasian Economic Union, which includes Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan.

Strengthening cooperation

Russia counts on cooperation with Kazakhstan within the World Trade Organization, says the head of the Russian Economic Development Ministry’s trade negotiations department Maxim Medvedkov.

“We’ve expected this to happen for many years. This is the result of many years of talks, with Russia’s direct participation in the last six years,” Medvedkov said.

READ MORE: Russia’s first year in WTO: short-term pain to get long-term gain?

The signing of the protocol by Kazakhstan is a big advantage for the Customs Union and the Eurasian Economic Union, he added.

“This is the next step towards forming its international legal standing. As soon as Belarus finishes its accession to the WTO – hopefully this will happen in the near future – the union will be eligible to become a member of the organization,” he said.

Kazakhstan’s WTO membership is also favorable for bilateral relations as the WTO agreement will be used in the sectors not regulated by the economic union agreement, he added. It will contribute to stability and prospects for further development of trade as the countries “will be cooperating within the WTO.”

Article source: http://www.rt.com/business/310938-kazakhstan-wto-membership-russia/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

This is the first major music company to settle with the Russian network, with similar claims from Universal Music and Warner Music remaining under investigation.

READ MORE:​ World’s top record labels sue VKontakte for allowing piracy

The settlement was signed in the Arbitration Court of St. Petersburg, where the claim on music copyright violation was considered, Vedomosti reported Tuesday citing people close to both parties. As a result, Sony Music removed all of its claims. 

According to the sources, VK will gradually upgrade its music service and introduce paid elements. On mobile devices the music will be available only by subscription. PC users will be able to listen to music for free, but will be required to watch commercials. The subscription won’t be immediately introduced; VK will first test its services for free.

Apple has also recently started a streaming service, which means you can listen to music online, but can’t download it. Subscription in Russia will cost about $3 per month. Google Play Music monthly subscription costs a few cents more.

The agreement with Sony could result in settlements of the two other lawsuits against VK – by Warner Music and Universal Music, Vedomosti said. A person close to one of the parties in the negotiations said late on Monday the court postponed considering these cases until September.

Sony Music, Warner Music and Universal Music started suing VK in spring 2014, when they accused the social network of piracy and demanded it stop using music without permission and reimburse about $835,000 at the current exchange rate (50 million rubles). The companies insisted that VK should introduce digital fingerprint technology that prevents re-downloading of pirated tracks.

Article source: http://www.rt.com/business/310935-vkontakte-sony-copyright-settlement/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

“We’re not standing still. We believe that Slovenia, which has always taken a constructive position on this matter, may be involved in other projects, including the Turkish Stream project, at a time when the final agreement on its implementation is reached,” Medvedev said.

Slovenia’s Prime Minister Miro Cerar said that after the parameters of Turkish Stream are defined his country will assess the need for Russian gas transit through its territory.

READ MORE: Gazprom to build new 63 bcm Black Sea pipeline to Turkey instead of South Stream

It’s up to the European Union to decide on means and methods of Russian gas transit beyond the Turkish Stream pipeline hub at the Turkish-Greek border, Medvedev added.

The pipeline’s key parameters differ from those of the South Stream project, he said.

“During the South Stream project we initially wanted to agree with everyone but that did not happen due to the position of the EU,” the Russian PM said.

Turkish Stream is another story as it’s a commercial project, that’s why “the EU should decide itself how and where the gas should be delivered on its territory to avoid similar problems.”

READ MORE: Russia, Greece sign €2bn deal on Turkish Stream gas pipeline

Russia’s task is to make gas available across the Black Sea to the Turkish-Greek border while the rest is up to European customers, said the Russian Prime Minister.

Turkish Stream is the replacement for the South Stream gas pipeline which Russia suspended in December as the EU blocked its implementation.

The 1,100 kilometer Turkish Stream pipeline will have four lines and an annual capacity of up to 63 billion cubic meters (bcm) of gas. About 16 bcm will be supplied to Turkey while the remaining 47 bcm will go to a hub on the Greek – Turkish border to be transported onwards to Europe.

Article source: http://www.rt.com/business/310881-russia-slovenia-turkish-stream/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Russia suggested European authorities deal with the Netherlands’ exports to avoid a temporary ban on cut flowers delivered from the whole of EU, the watchdog said, adding that Dutch flowers are usually given certificates by the Czech Republic, Slovakia, Bulgaria, Latvia, Lithuania, Hungary and Poland.

The ban could temporarily affect all flower imports from the Netherlands, according to a watchdog representative cited by TASS.

“Each shipment has a certificate from these countries, which guarantees the products fully meet the health and legal requirements of Russia and the Eurasian Economic Union,” the Monday statement said.

READ MORE: Russia considers banning chocolate and flowers from EU – food safety watchdog

However, according to the hygiene watchdog, over 300 recent shipments of cut flowers contained quarantine organisms, with 183 cases of the infected deliveries grown in the Netherlands.

Urgent technical consultations with European authorities should be held to address the issue, Rosselkhoznadzor said.

“There were no Rosselkhoznadzor restrictions, we only sent a request for consultation with the EU,” the assistant head of Rosselkhoznadzor Alexey Alekseyenko said. He was answering a question on whether Monday’s move meant a ban on imports of the Dutch flowers, RIA reports.

Any decisions will be made after consultations where issues like delivery of flowers from the Netherlands, and their transit through other countries will be discussed, Alekseyenko said.

Rosselkhoznadzor expects talks to be held as soon as this week if the EU responds as “the EU’s interest in the issue is significant.”

“If they [the competent authorities of the European Union – Ed.] do not respond, restrictive measures will follow,” the official added.

The Dutch government said Monday it had not been informed about problems with the flowers, or about a ban, according to Thierry Van Es from the Netherlands Agriculture Ministry.

After the EU extended its anti-Russian sanctions in June, there have been reports Russian counter-sanctions might include bans of such popular European exports as flowers.

“Many other countries are willing to supply us flowers, and in this case our industry in the area will begin to slowly recover should there be an embargo,” Alekseyenko said in an interview last month.

Deliveries of cut flowers and flower buds for bouquets from the Netherlands are a considerable part of EU exports to Russia, as last year 30,700 tons valued at $225.4 million were exported.

Article source: http://www.rt.com/business/310873-russia-netherlands-flowers-ban/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

“The dramatic fall in oil prices in 2014 and subsequent dismantling of 2015 company budgets has, by mid-year, already resulted in over 45 major project final investment decision (FID) deferrals,” analyst Angus Rodger from Wood Mackenzie reported late Friday in his blog.

The deferred range of onshore, shallow-water and deepwater projects had 20 billion barrels of oil, according to the report.

Over 50 percent of those reserves are located in deepwater projects, and nearly 30 percent in Canadian oil sands. The majority of the projects are “targeting start-up between 2019 and 2023”. If major energy firms continue cutting future capital commitments then those dates will be pushed back further.

READ MORE: Oil producers to lose $1tn if price below $60 – Goldman Sachs

BP, Shell, Chevron, Statoil and Woodside Petroleum are said to be among the big companies postponing projects, the FT reports. This week Shell will set out deeper cuts to its capital spending, with its more recent expenditure estimated at $33 billion.

Postponing “final investment decisions” is one of the responses to falling oil prices as it frees up capital that can be deployed elsewhere and pushes back expenditure. This can ease the hit falling crude prices has on revenue.

Calling off investment also boosts free cash flow and helps the companies cover dividend payouts which can strengthen investor confidence.

The sliding oil price has been matched by a broader decline in a value of copper, gold and other raw materials, which pushed the Bloomberg commodities index to a six-year low.

READ MORE: Russian currency edges closer to 60 against dollar, as oil slump deepens

After more than a 30 percent rebound in the first quarter of 2015, oil prices have started falling again.

On Monday crude fell to near four-month lows due to sharp drop in Chinese stock markets. Evidence of a global oil supply glut has halved prices in the past year also affected the crude plunge.

Brent crude for September on Monday was down to $53.41 a barrel at 17:20 MSK. West Texas Intermediate (WTI) stood at $47.37.

Article source: http://www.rt.com/business/310859-oil-price-spending-cut/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

In a telephone call with international hedge funds supposedly run by former British Chancellor of the Exchequer Norman Lamont on July 16, Varoufakis said he had been given a green light in December by future PM Tsipras to prepare a plan for a parallel payment system, the Greek newspaper Kathimerini reports.

Varoufakis acknowledged then he might be recorded, but said if the talk became public, he would deny it.

His plan would have involved hacking into the taxation service database to gain access to tax registration numbers of people and companies. However, Tsipras backed out, Varoufakis said.

The idea was to create reserve accounts attached to tax file numbers. The government would have given PIN numbers to holders of taxation numbers, and created digital transfers into reserve accounts of the tax file numbers. So, if the banks were shutdown “as a result of the ECBs aggressive action to deny some breathing space,” Varoufakis’ plan would have been a parallel payment system. 

“This was very well developed and I think it would have made a very big difference because very soon we could have extended it, using apps on smartphones and it could become a functioning parallel system and of course this would be euro denominated but at the drop of a hat it could be converted to a new drachma,” said Varoufakis.

He said that he was shocked to find out that the taxation department, the General Secretariat of Public Revenues, was under full control of the troika of international creditors, and his ministry couldn’t influence it.

“It’s like the Inland Revenue in the UK being controlled by Brussels. I am sure as you are hearing these words your hair is standing on end,” said the former minister.

Soon after Varoufakis became minister, it became clear that the software in the Ministry of Finance was also controlled by the troika. He turned to his friend, a professor of IT at Columbia University in the US.

“At some point, a week or so after we moved into the ministry, he calls me up and says to me: “You know what? I control the machines, I control the hardware but I do not control the software. The software belongs to the troika controlled General Secretary of Public Revenues. What do I do?” said Varoufakis.

READ MORE: ‘He doesn’t negotiate, he kicks ass!’ Why Varoufakis was the coolest finance minister ever

In responding to media reports on Monday Varoufakis stressed that the quotes were accurate, but his intentions were twisted, as if he was for the drachma from the beginning, while he always was “completely against dismantling the euro.” All the plans he was working on during his term in the Cabinet were aimed at serving the interests of the Greek people.

“Ever since Mr. Varoufakis announced the existence of the Working Group, the media have indulged in far-fetched articles that damage the quality of public debate. The Ministry of Finance’s Working Group worked exclusively within the framework of government policy and its recommendations were always aimed at serving the public interest, at respecting the laws of the land, and at keeping the country in the eurozone,” said a statement on Varoufakis’ website.

After 61 percent of Greeks voted against austerity in July, Varoufakis resigned, saying it would help Tsipras negotiate a better deal with foreign creditors. When the €86 billion rescue plan for Greece was reached by Tsipras and the lenders, Varoufakis said it was doomed to fail and voted against it in parliament.

Article source: http://www.rt.com/business/310825-varoufakis-hack-ministry-of-finance/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

BNP has been doing “beta testing” involving the cryptocurrency, and will make an announcement soon, an unnamed spokesperson told the IBTimes UK Friday.

“We are looking at blockchain technology and how it can be applied to post trade processes to make things faster and potentially cheaper, but it’s all very much a project and it’s all in testing. It’s nothing live,” the spokesperson said.

Blockchain technology is software that allows the digital currency to function and be transferred safely; it is spread across thousands of computers and servers globally. The technology is believed to secure transactions and make them transparent.

Earlier this month, BNP’s analyst Johann Palychata described bitcoin as being able to make certain industry sectors “redundant,” claiming that blockchain technology “should be considered an invention like the steam or combustion engine.”

Major banks such as UBS, Barclays, ING, Goldman Sachs and BNY Mellon have also announced ventures into blockchain technology.

A survey by market intelligence provider Greenwich Associates showed that 47 percent of financial institutions are exploring ways of using bitcoin technology.

Bitcoin bourse: UK’s first regulated digital currency exchange in pipeline

This week another large French bank, Societe Generale published a job offer for an IT developer on bitcoin, blockchains and cryptocurrencies. The 12-month contact said to involve “developing proof-of-concept in any language/protocols used in cryptocurrency protocols and blockchains 1.0-3.0.” The position was said to be part of an effort to evolve in the face of technology-driven changes in the financial sector.

On Wednesday the Tunisian government advertized on its Facebook page for an intern in the Ministry of Communication Technologies and Digital Economy in order to explore both bitcoin and blockchain technology.

The Nasdaq may become the first major exchange to use the technology behind bitcoin. It is now partnering with infrastructure provider Chain to use blockchain to issue and transfer the shares of privately held companies.

READ MORE: First Bitcoin-based security starts trading on Nasdaq Nordic

“The technology will be of fundamental importance to Wall Street,” Nasdaq Chief Executive Officer Bob Greifeld told Bloomberg Thursday. “The benefits to the industry are immense and cannot be ignored.”

Article source: http://www.rt.com/business/310693-bnp-bitcoin-blockchain-use/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Apart from weak oil, which is the main factor for the ruble stumbling, the selling of foreign currency by exporters, that was expected to strengthen the ruble, didn’t meet expectations.

The ruble’s fall was not even soothed by the Russian tax period when demand for the national currency traditionally grows.

After losing about 50 percent last year, the ruble started regaining ground and was trading at 49 to the dollar at its peak after hitting rock bottom at 79 in December. Some Russian officials thought this meant the link with the oil price was over.

Russian policymakers, including Economic Development Minister Aleksey Ulyukaev, have insisted the ruble has found its fair value. He said the ruble’s fundamental value is 55 plus-minus three rubles to the dollar. 

However, after the peak came disappointment, with the ruble losing more than 15 percent.

Over the last couple of weeks there have been various forecasts for oil prices, sometimes contradictory. A huge mix of factors including Iran’s comeback, possible US rate hike, a slump in China’s stock exchange as well as crises in Greece and Ukraine make it not a matter of pure economics but rather a matter of difficult to predict expectations and speculation.

Most analysts remain cautious saying both – upward and downward dynamics – are possible. Most recently, Morgan Stanley said the fall in crude prices could be the worst in 30 years, adding that it sticks to a forecast the prices will rise. Earlier this week the oil guru Gary Ross, the founder of consultants PIRA Energy Group who predicted last year’s rout said crude prices could return to $100 a barrel in the next five years.

Article source: http://www.rt.com/business/310674-ruble-follows-oils-route/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Three hundred and nine Russians had an income of more than one billion rubles compared to 292 the year before; Russian daily Izvestia reported Federal Tax Service data Friday.

Russia also had 451,000 people with incomes between one and 10 million rubles, a jump of 13 percent.

The number of people who submitted tax forms grew last year along with the amount of income tax paid, which was up over 12 percent at 58 billion rubles.

In April Forbes reported that the number of US Dollar billionaires in Russia fell to 88 from 111.

Analysts say that the Russian currency’s devaluation and the anti-offshore policy helped Russians create new fortunes.

Some people adjusted to the situation and could take advantage of it, according to Roman Terekhin, partner from legal firm Delovoy Farvater. “It was possible to make money on currency rates, on the rise in prices for imported goods, etc. Those who receive a salary or have savings in foreign currency also saw growth in income as the ruble weakened and their income increased,” Terekhin told Izvestia.

“We see that many wealthy customers have returned part of their property from offshores back to Russia. Their income is now declared in Russia and the taxes are paid which influence the statistics,” Mikhail Orlov, the head of the tax and legal department of KPMG said.

In 2014, the ruble lost almost a half its value against the US dollar due to plummeting oil prices and Western economic sanctions. Until mid –May 2015 the currency recovered to hit 49 rubles against the greenback.

READ MORE: Russian ruble hits 18-wk high

However, the currency has been mainly going down in recent months, pressed by the expectations of Iran’s comeback to the oil market, an increase in the US interest rate as well as crises in Greece and Ukraine. On Friday the ruble was trading at 58.43 against the dollar and 63.91 against the euro by 15:25 MSK on the Moscow Exchange.

READ MORE: Putin signs law on offshore assets amnesty

Last year Russian President Putin signed an anti-offshore law requiring individuals and businesses to report foreign profits. The bill was aimed at curbing the outflow of capital from Russia which was estimated at $2 trillion in recent years.

The number of Russian offshore transactions almost halved in the first quarter of 2015, falling from last year’s $13.1 billion to $5.9 billion, the Russian Central Bank said.

Article source: http://www.rt.com/business/310667-russia-ruble-wealthy-growth/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

“… credit rating agencies are one of the most important elements of the financial market infrastructure. Their activities must be stable to various factors, including geopolitical risks,” the CBR said in a statement Friday.

READ MORE: Putin inks law on rating agencies’ activities in Russia

“Russian market needs a strong credit rating agency with a high level of corporate governance and professional competence,” the statement said. It added that the new agency will have to meet the interests of the economy and have a good reputation for both Russian and foreign investors.

The agency will be headed by Ekaterina Trofimova, the vice president of major Russian state-owned bank Gazprombank. The lender says Trofimova will stay with Gazprombank despite her new appointment.

The agency plans to become self-funding in the next 3-5 years and enter foreign markets in the future, according to Trofimova. A pool of investors has developed and applications will be accepted from next week.

“At the initial stage, the agency will work in the Russian domestic market, but plans to gradually enter other markets, firstly the Eurasian Economic Union,” she said.

The question of cooperation with China’s Dagong rating agency was not discussed, she added.

READ MORE: Russia’s downgrade by Western ratings agencies ‘politicized’ – Dagong boss

The CBR has denied earlier reports it would be a shareholder in the new national rating agency, saying it would be against federal law.

Companies wishing to have a share in the agency have apply by August 28, says the head of Rosbank Dmitry Olyunin. The list of founding shareholders is not closed, he added.

The head of Russia’s smaller lender Binbank, Mikhail Shishkhanov, who took part in a CBR meeting Friday, said each founder of the national rating agency will receive no more than a 5 percent stake.

Russia’s second largest bank VTB and one of the country’s biggest insurers Rosgosstrakh said they would take part in establishing the new rating agency.

Earlier TASS reported the agency could have more than 20 stakeholders. 

Currently Russia has a number of local rating agencies that are not internationally recognized. The list includes RusRating, Expert RA, the National rating agency and AKM.

Last Tuesday President Putin signed a law regulating the activity of ratings agencies in Russia, as discontent over ‘politicized’ actions of the Western ‘Big Three’ – SP, Moody’s and Fitch – has grown.

The BRICS countries are also discussing setting up a rating agency. Russia and China planned to launch a new Universal Credit Rating Group (UCRG) in 2015, but market participants said talks have stumbled due to political reasons.

Article source: http://www.rt.com/business/310645-russia-rating-agency-bank/?utm_source=rss&utm_medium=rss&utm_campaign=RSS